CREDIT AND OPERATIONAL RISK MANAGEMENT - BMEGT35M127

Business decisions are surrounded by uncertainty and all sorts of risks. Sustaining success in business and finance is only achievable by understanding the characteristics of major risks and by being prepared to handle them. This course focuses on two fundamental risk types: credit risk and operational risk (oprisk). These risk types are among the most essential risks endangering financial services sectors. Therefore, they receive strategic focus from top management. In fact, all undertakings and individuals are strongly exposed to credit and operational risks. The major objective of the course is to provide fundamental information, building on theoretical knowledge and prac-tical insights, maintaining both an appropriate holistic view and detailed level analyses on the most relevant real-world cases. Regarding credit risk, the course covers modeling basics, credit risk management aspects, further specific topics (counterparty risks, securitization, experts models), mostly in banking risk management context but also in-cluding major corporate risk management considerations. Related to oprisk, the course presents the basic framework applied at banks and insurance companies, also addressing some other very current related topics, like the risk of financial crime, cyber risk, business continuity planning. These themes will be embedded into fundamental information on banks’ general risk management and highlights on statistics and R programming. The program of the course is designed with the aim, that the audience will develop awareness and interest in credit risk and oprisk management will have adequate fundamental professional information, will be equipped to solve basic related tasks (modeling, policy writing, programming, research-creation) and will be capable to develop professionally further.

1. the characteristics of credit risk and oprisk;
2. basic methods of risk management;
3. risk measurement methods;
4. risk managing and mitigation techniques.

1. plan and organize independent learning,
2. comprehend and use the professional literature of the topic,
3. identify and measure the risks on a basic level related to credit risk and oprisk,
4. provide relevant information to support decision-making.

1. is aware of the potential surrounding credit and operational risks and interested in risk management,
2. collaborates with their instructors and others during the learning process,
3. gains knowledge and information,
4. uses the possibilities offered by IT tools.

1. is open to accept constructive criticism,
2. collaborates with others to solve problems during the learning process,
3. could make prudent financial decisions,
4. understands the importance and weight of responsibility and can assess the consequences of decisions.

Lectures, written and oral communication, use of IT tools and techniques, optional tasks alone and in groups.

• Kötelező - Obligatory: A félév folyamán folyamatosan feltöltött előadás diák. - Slideshows of the lectures which will be uploaded continuously during the semester.
• Ajánlott - Recommended:
• Hull, John C. (2018): Risk Management and Financial Institutions. Fifth Edition. John Wiley & Sons

Assessment of the learning outcomes is based on the end-term exam. The optional homework can affect the outcome by up to 20%.

• The audience could gain extra points with the optional homework.: 10

• Exam: 100

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According to TVSZ.

Consulted with the Faculty Student Representative Committee, approved by the Vice Dean for Education, valid from: 04.11.2024.

Topics and their timing will be arranged by the calendar or other circumstances in each semester.